Close Ad

The Spoon

Daily news and analysis about the food tech revolution

Israel food tech

Incredo Sugar: Redefining Sweetness, Delighting Taste Buds, and Nurturing Health

The intake of excess sugar in our diets is an epidemic that has no season or one that lies stealthily in refrigerators or airplane tray tables. Healthy Food America notes that the United States leads the world in the consumption of added sugars and ranks third in the world in sales of sugary drinks. All this sugar has consequences – the U.S. has one of the highest overall obesity rates in the world and the highest rate of childhood obesity, not to mention heart disease and diabetes.

Several attempts to replace sugar with artificial sweeteners such as Aspartame and Saccharin have been mildly effective, asking consumers to give up taste to unsweetened diets. Natural options such as agave, monk fruit, and Stevia round out this list focusing on substitution rather than the complex approach of manipulating a sugar molecule. Enter Incredo (formerly DouxMatok), an Israeli company with an idea that maximizes the properties of sugar but limits its impact on the body.

Born out of necessity in World War II, the story is a part of history led by Prof. Avraham Baniel, a renowned chemist in Israel. The best retelling of the journey from concept to realization can be found in an episode of the Netflix series “Explained” (Season Three, Episode 1). In short, Prof. Beniel discovered that by adding starch to sugar crystals, consumers could use less sugar with the same taste. Fast forward to 2001 and then to 2013 and 2014, and Baniel brought his earlier discovery back to life with a significant improvement. Using a small “carrier” with the active ingredient (sugar) as part of the refinery process results in a cluster of sugars rather than a new molecule. These clusters will then linger on the tongue, optimizing flavor delivery.

Incredo CEO Ari Melamud

The Israeli food tech startup recently announced the close of its latest (and most significant) fundraising round to date, coinciding with the unveiling of a new company name, Incredo LTD, based on the company’s signature product Incredo® Sugar. In an interview with The Spoon, company CEO Ari Melamud discussed how Incredo is poised to create a healthier sugary experience.

Using a chocolate bar with 13 grams of sugar as an example, Melamud said Incredo could reduce the sugar content by 30 percent to 50%, which could be great news for those with diabetes and other related conditions.

“It changes from one application to another and even from one recipe to another because every recipe is very different depending on the other ingredients inside,” Melamud said. “So, on average, we can say we can drop 40%. And again, our technology is not a diabetes solution. But we’re a mass market solution to help everybody prevent becoming diabetic in many ways. Because if you look at the numbers and statistics on a global average, we’re consuming about three or four times more sugar than recommended. If we can drop it by 50%, 40 to 50%, that’s a big difference for a lot of people preventing people from becoming diabetic actually. This is our main mission and our main tasks.”

Even in its earliest stage, DouxMatok has developed significant commercial partnerships with Better Nutritionals, a supplement manufacturer; Batory Foods, a specialty ingredient company; and Blommer Chocolate Company, North America’s largest cocoa processor and ingredient chocolate supplier.

If the company’s Incredo Sugar has one Achilles heel, it will not work with liquid (preventing use in beverages) because it quickly dissolves, bypassing the product’s lingering taste experience. After hearing DouxMatok’s story, the issues with liquid are small hurdles that could be rapidly overcome.

Dispatches from Israel Food Tech Ecosystem: Amir Zaidman, The Kitchen

Last month, I visited the Kitchen Hub at their office in Ashdod, Israel and sat down with Amir Zaidman, Co-Founder and Chief Business Officer of the Kitchen. Prior to co-founding the Kitchen, he spent 10-14 years in business development in medical technology working on both the startup and investing sides. 

We chatted about what the Kitchen does, what sets Israeli startup founders apart, what the ecosystem needs, how precision fermentation is the new software, and what it’ll be like for Israeli customers to try the first cultivated meat product. 

J: Let’s talk about what the Kitchen is and what it does. 

A: First and foremost, we have capital we invest in startups like a seed or pre-seed stage venture capital. We have more money than a typical seed stage venture capital would invest because we are also getting money from the government to invest in those startups. While a typical seed stage fund would not invest $200-0.5M, we can invest closer to $1M in a company. Those companies become portfolio companies and they have access to the facility but it’s also the very close support that the team in the Kitchen is giving the teams in the companies. At least for the first 2-3 years after we invest in them, it’s a very intense relationship. 

J: Would you say the Kitchen is like a venture studio? 

A: Not exactly. For us, venture studio is when we start with a blank page. Then we brainstorm and figure out what we want to do based on needs from the industry, global trends, and where the industry is going. We start scouting for the enabling technologies, science, intellectual property that might be relevant for the project. When we find that, we go into negotiations with universities or research institutes and we go into a licensing agreement to own the license for that technology. Then we go recruit the team and give them equity into the new company that we created that holds the license for the technology. The venture studio model for us is starting from nothing and bringing all of those building blocks together. 

The third thing the Kitchen does is activity in the foodtech community in Israel. 

J: Let’s dive into your role here, I understand there’s two main components so can you elaborate on what those are?

A: I take part in this venture studio model by thinking about our new directions and what we need to do. The most significant part is making deals with universities and entrepreneurs for the terms under which they’ll come into the Kitchen. It depends on whether or not it’s a venture studio or a regular investment. But if it’s a regular investment, it’s very much in line with a typical VC investment model. And if it’s on the other side, then it’s more complicated with the licensing agreement and everything that has to do with that. 

The second thing, which is the part of my job that keeps me most busy, is working with the CEOs of the startups on their business development activities, around possible agreements that they might have like joint development or collaboration agreements, and most importantly, on their next round fundraising.

J: You have a view of the entire food tech ecosystem here because you’re working with many startups, but you also have a more specific view of individual startups and what they need. What secret weapon do startups here have that make them competitive in a global market? 

A: I think there’s a few elements to that. One is that Israelis are very entrepreneurial, which means that a person might define himself as an entrepreneur, regardless of the vertical that he’s working in. One day, he’s an entrepreneur in medical technologies and the next in food tech. When there is a new field which is impactful, it will draw seasoned entrepreneurs from other verticals to come and build their next startup in the space. 

The second thing is that there’s a lot of innovation in Israel. 

But I think the most important is that because Israel is such a small market, all Israeli startups are born global. They never consider the Israeli market first. They think of Europe, the US, and Asia first. They have to think global which helps them get a bigger sense or a better sense of the bigger picture.

J: Where do you find the best research and the best founders here?

A: Everywhere. The food tech sector is so diverse. If you look at cybersecurity, they come from specific intelligence units in the military. It doesn’t work like that in food tech in Israel. We source the IP and science from specific research institutes, but the entrepreneurs themselves, we get them from everywhere. We get them from previous entrepreneurs of biotech companies, medical technologies, or food companies.

J: They come from everywhere but what are the characteristics that they share? When you’re thinking about building a community of food tech startups here, what are you looking for? 

A: You don’t stumble upon foodtech. It’s not something that you do because it was there, you have to want it. And you typically want it because you feel that this is something that can change the world for the better. All of the CEOs and founders of those companies are passionate like that and this is what makes them unique. 

J: With the Kitchen’s access and view of the food tech community as a whole, what is it that you think that founders here really need? What kind of resources do you hope will become more accessible in the coming years?

A: You’re touching a very hot point, because we’ve been talking about those issues for the past three years. If you’re a food startup in the US, you’ll come up with the idea, you will go to a research center, and they will help you develop it. In Israel, you cannot outsource the development or the manufacturing.There’s a lot of infrastructure that is missing. And we’re working on that. Not the Kitchen specifically, but the Israeli community with some support from the government. Every startup in precision fermentation has to buy some equipment and there’s a movement to set up a precision fermentation center, which will be like cloud computing but for precision fermentation. You can do the very small scale in your lab and when you go up one notch to bigger fermenters, you will be able to lease and not buy. 

J: This is interesting because food tech is a very capital intensive industry compared to software.

A: Software used to be capital intensive, because you used to have to own your own servers,  until AWS and Amazon invented web services. And suddenly, it didn’t have to be so capital intensive because you can have everything on the cloud. 10-15 years ago, it wasn’t like that. This is now also changing in food tech.

J:Ultimately, the goal of food tech is to change the way people eat which requires a big behavioral change, even if the technology is there. How would you say the consumers here in Israel have been reacting to things like cultivated meat? 

A: I can’t really say because no cultivated meat product has been launched in Israel yet. We’re hoping the first ones will be launched by the end of this year. I can tell you that Israel is very fast to adopt new trends and technologies and it’s very plant based. I expect those new technologies to be very well accepted. Although the market is small, it’s gonna be a very good test market for every new product. We have a lot of chefs that are extremely interested in what’s happening in food tech because they want to incorporate the new technologies into their menus. It wasn’t like that, three-four years ago but now the culinary world and the food tech worlds are getting closer together.

J: Cultivated seafood was one of the theses the Kitchen had that resulted in Wandafish and Forsea. Clean packaging and reduced sugar have also been themes among the Kitchen’s portfolio. My final question is, as you’re thinking about the trends and new theses to follow, what technology are you hoping to see?

A: One of the main things we are hoping to find is technologies that will enable sophisticated technologies like precision fermentation and cell cultivation to produce products that will be affordable. Because today those technologies are expensive and they produce expensive products. Cultivated steak will probably be more expensive than a regular store-bought animal based one because the meat industry is good at creating affordable products at mass scale. It’s very difficult to compete. The companies that are creating cultivated meat are very close to market but they have premium prices. So we’re looking for the technologies to enable them to reduce costs, to reduce price, to be more efficient, and to bring the gospel to the people. 

Edited for clarity and length

Dispatches From the Israel Food Tech Ecosystem

When I first attended the Greencircle NY-Israel food tech conference in New York City last year, I never imagined that I would be living in Israel just a year later, exploring the food tech ecosystem for myself. I relocated to Tel Aviv in mid-January for an exchange program and have since been discovering the richness of Israel’s culture, language, cities, people, and places. While the high-tech innovation was a significant draw, my primary goal was to immerse myself in the culture and history of Israel as a whole. In the short time I’ve been here, I learned that the country’s foundation lies in its entrepreneurial mindset.

As I met more local Israelis, I was struck by the sheer number of people working in the high-tech industry. It makes sense considering Israel’s startup history dates back to the country’s founding. As a young nation facing existential threats, Israel’s defense system has always had to adapt to new scenarios, avoiding heavy reliance on conventional methods. There is a strong culture of questioning everything, evident in both political protests and companies that foster a climate of critical thinking. This environment encourages innovation not only for entrepreneurs but also for intrapreneurs, who develop new ideas and frameworks within existing organizations.

Food tech and ag tech are thriving industries in Israel, driven by the nation’s limited natural resources, water shortages, and a broader global climate crisis. According to the Good Food Institute Israel, alternative protein startups in the country raised $454 million in 2022, making up 30% of climate tech investments. Moreover, Israel ranked second globally, only behind the US, in alternative protein investments. The Israel Innovation Authority, an independent publicly-funded agency, is a significant driver of the country’s food tech advancements, offering a variety of practical tools and funding platforms to meet the needs of local and international innovation ecosystems.

Leading universities such as Hebrew University in Jerusalem, Technion University in Haifa, and Tel Aviv University also contribute to food tech innovation through academic research. However, beyond government funding and academic research, I am particularly interested in the intangible aspects of Israel’s culture that foster a high concentration of founders and an environment conducive to risk-taking. 

Roee Nir, the co-founder of Forsea, a cultivated fish company making an eel product, told me what sets Israeli founders apart is, “We are Israelis, and we are very communicative within ourselves. We like to meet, we like to share ideas, and we love that this is a very central industry that is erupting from Israel.”

Similarly, Anat Natan, the co-founder of Anina Culinary Art, credits the Israeli mindset of daring, inventive, and non-traditional thinking.  When asked where this mindset comes from, she told me “If you look back, the Jewish needed to survive. Even though we’re very advanced as a country in a lot of aspects, we’re a startup nation. We’re only 75 years old. We’re still establishing (ourselves), and when you’re building something, you have to do more than when you maintain something. We’re still in the building phase of the Israeli country.” 

In this series, I will continue to explore that startup mindset and developments in Israel’s food tech industry through interviews with founders and investors. I will delve into how startups are established, the groundbreaking innovations taking place, and the implications for Israel’s agricultural sector, environment, economy, and even its conflict with Palestine, because no analysis of food technology in Israel would be incomplete without considering the complex political environment. The food chain is an intricate web that intersects all aspects of society, which is especially true in a region as diverse and multifaceted as the Middle East.

Stay tuned for my first interview tomorrow!

Joy Chen is a contributor at the Spoon and has been writing about robotics and alternative proteins for the past year and a half. Although originally from the United States, she is currently studying at Tel Aviv University in Tel Aviv, Israel.